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The Chodai Group to develop new small-scale hydroelectric plants on Mindanao Island in the Philippines

2013/07/04

On July 3rd, Chodai Co., Ltd. and group company Kiso-Jiban Consultants Co., Ltd. (“Kiso-Jiban”) signed a memorandum of understanding (MOU) with Equi-Parco Construction Company, the largest general contractor on Mindanao Island headquartered in Butuan City, Twinpeak Hydro Resources Corporation (“Twinpeak”, also headquartered in Butuan City), and Hydropower Resources Management and Consultancy, Inc. (“Hydropower”, headquartered in Quezon City in Metro Manila) on the joint development of a 10 MW hydroelectric plant (development costs approx. 3.5 billion yen), the Wawa River small-scale hydroelectric plant (the “Project”), in Sibagat in Agusan del Sur province on Mindanao Island.

The Project qualified for the “Study on Economic Partnership Projects in Developing Countries in Fiscal Year 2012” under the Ministry of Economy, Trade and Industry (METI), and a survey of three sites (23 MW in total) was implemented over approximately 6 months until the end of February this year, and the site with the most potential (10 MW, development costs approx. 3.5 billion yen) was then chosen based on the survey results. Consensus was reached to carry out a detailed survey and design with the goal to open the plant for operations in 2015, which in turn led to the signing of the MOU.

The Chodai Group agreed to jointly establish a special-purpose company (the “SPC") with three local companies for the development and operation of the small-scale hydroelectric plant, and also signed a contract for the performance of five kinds of related consulting work. It was also agreed to give top priority to the application of a two-step loan from the Japan Bank for International Cooperation (JBIC) to provide funding for the Project.

Through this power plant project and other projects such as industrial park developments, the Chodai Group would like to continue acting as an intermediary for Japan and Japanese companies to promote increased participation in local projects and strongly contribute to the economic development of Mindanao Island.